Co-operative Housing Societies -levy of GST

1. GST is applicable to every person or entity dealing in supply of goods & services &. it includes a  Co-operative society registered under any law. (Section 2(84)(i) of GST Act)

2. What is Co-operative Society:-

Co-operative Housing Societies are entities registered under the co-operative laws of the respective States.

According to Section 2(16) of the Maharashtra Co-operative Society Act, 1960, “housing society” means a society, the object of which is to provide its members with open plots for housing, dwelling houses or flats; or if open plots, the dwelling houses or flats are already acquired, to provide its members common amenities and services.

Simply put these are a collective body of persons, who stay in a residential society. As a collective body, they would be supplying certain services to its members, be it collecting statutory dues from its members and remitting to statutory authorities, maintenance of the building, security etc.

Types of Co-operative society are- Housing Co-operative societies, Social Co-operatives and Co- operative Banks etc.

A Society is akin to a club, which is composed of its members. So, can a service provided by a Housing Society to its members be treated as service provided by one person to another. The answer is yes. The following extracts of the GST law will make the position clear.

As per Section 9 of CGST Act, 2017, levy of GST is on supply of goods and services. As per Section 7 expression “supply” includes––

(a) all forms of supply of goods or services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business;

The definition of “person” in Section 2(84) (i) of the CGST Act, 2017 specifically includes a co-operative society registered under any law relating to co-operative societies. Thus a registered co-operative society is a person within the meaning of the term in the CGST Act.

The next question which arises is whether the activity of the society can be said to be in the course or furtherance of business. The definition of business as per section 2(17) of the CGST Act, 2017 is as under

“business” includes––

(a) any trade, commerce, manufacture, profession, vocation, adventure, wager or any other similar activity, whether or not it is for a pecuniary benefit;

(b) any activity or transaction in connection with or incidental or ancillary to sub-clause (a);

(c) any activity or transaction in the nature of sub-clause (a), whether or not there is volume, frequency, continuity or regularity of such transaction;

(d) supply or acquisition of goods including capital goods and services in connection with commencement or closure of business;

(e)  provision by a club, association, society, or any such body (for a subscription or any other consideration) of the facilities or benefits to its members;

(f)  admission, for a consideration, of persons to any premises;

(g) services supplied by a person as the holder of an office which has been accepted by him in the course or furtherance of his trade, profession or vocation;

(h) services provided by a race club by way of totalisator or a licence to book maker in such club ; and

(i)  any activity or transaction undertaken by the Central Government, a State Government or any local authority in which they are engaged as public authorities.

Thus, as per section 2(17)(e) of the CGST Act, 2017 provision by a club, association, society, or any such body (for a subscription or any other consideration) of the facilities or benefits to its members is deemed to be a business. The activities of the housing society would thus attract the levy of GST and the housing society would be required to register and comply with the GST Law.

Thus, by virtue of definition, housing society is also a person for the purpose of GST.


Following are the major activities of housing societies:-

(a)  Formation of society on completion of building.

(b) Allotment of shares

(c) Collect contribution from members for maintenance of building & premises.

(d) Collection of property Tax from members & remitting it to Local Body / Municipality / Municipal Corporation.


Housing Co-operative Society provides services to its member by way of providing facilities ie housekeeping, security, premises maintenance etc. These activities of providing services to members and collecting maintenance charges is considered as business under (Sec 2(17)(e) of GST Act.


Section 22 (1) of CGST Act states that every supplier of services shall be liable to registered under this Act if his Aggregate turnover in a financial year exceeds Rs. 20 lakh.

Housing Co Operative Society is liable to be registered if Aggregate turnover of Housing Society exceeds Rs. 20 Lakhs AND monthly receipts from members towards Society maintenance charges exceeds Rs. 7500/- per person


Turnover receipts of the Housing Societies includes society maintenance charges from its members, receipts from investments, income receipts from advertisement board, receipts from mobile towers in premises, Share transfer fee from members, receipts from special purpose use of common area by member (marriage function etc) etc.

Housing Society is liable to register if total of all the receipts (including exempted receipts) exceeds Rs. 20 Lakh in a financial year


(a)  Receipts towards services provided for common use of its members. (i.e housekeeping charges, lift maintenance, common area security etc)

(b) Receipts towards services to members for specific purpose. (use of terrace, garden for functions such as birthday, marriage etc)

(c) Payments received from members for use of common area. (use of terrace, garden for functions such as birthday, marriage etc)

Any other receipt against services provided by society to its member which is not for common purpose.


(a) Property Tax:- 

Collection of property tax is statutory levy by a Municipal Corporation or a local Authority. It is levied on per sq ft basis and the owner of the property is liable to pay the same. A society is the mere collection agent and pays the tax collected from members to the Authorities. Under GST Act, services by pure agent is not taxable and housing society collects and remit property tax as pure agent. Therefore, Property Tax receipts are not taxable in the hands of housing society.

(b) Water Charges:-

Housing society provides pipeline to deliver water to the member’s premises. Local bodies issues water charges bills in the name of Society and society collects it from members and pays it to Local Body. Water Charges is not taxable under GST.

(c) Non Agriculture Tax –Maharashtra State Government and Electricity Charges:

Similarly, GST is not leviable on Non-Agricultural Tax, Electricity Charges etc, which are collected under other statutes from individual flat owners. However, if these charges are collected by the Society for generation of electricity by Society’s generator or to provide drinking water facility or any other service, then such charges collected by the society are liable to GST.

(d) Sinking fund, repairs & maintenance fund, car parking charges, Non-occupancy charges or simple interest for late payment:-

Attract GST, as these charges are collected by the RWA/ Co-operative Society for supply of services meant for its members.


A Co-operative Housing Society is liable to register under GST Act if following two criteria are fulfilled by it:

(a)  Contribution per month per member :

A Housing Society is liable to register if monthly contribution per month per member exceeds Rs 7500/-. Monthly contribution consists of sum of items indicated at Para 8 (a to d) above.

(b)  Aggregate Receipts:-

A Housing Society is liable to be registered under GST Act if aggregate receipts exceeds Rs 20 Lakhs in a financial year. The aggregate receipts include receipts of all the exempted and taxable categories.

10. Conclusion:-

In so far as tax implications on housing societies are concerned, the position prevailing under Service Tax is sought to be continued under GST. The tax burden under GST will be lower as the society would be entitled to take ITC which was hitherto not allowed under service tax. Moreover, the exemptions given ensure that there would be no tax burden on smaller societies where the monthly contribution of the individual members does not exceed Rs.7,500/-.

An effort has been made to bring out clarity regarding the applicability of GST to Housing Co Operative Society’s registration requirements and taxable & exempted services in easy to understand fashion.

Author Bio

Qualification: CMA
Company: S.R.Bhargave & Co
Location: PUNE, Maharashtra, IN
Member Since: 02 Jun 2018 | Total Posts: 1

More Under Goods and Services Tax


  1. GAYATRI R HIRVE says:

    Is GST registration mandatory to MULTI-STATE COOPERATIVE SOCIETY ???….and if yes, what are the taxable and exempted goods from gst…please guide asap…

  2. R.K. Nair says:

    Ours is a small co-operative housing society having 29 members. We have two lifts which are maintained by the suppliers of the lift. We pay Rs.24000/- for maintenance of these lifts. The contractors charges 18% on this amount. Is it applicable to us.

  3. VSrinivasan says:

    if a Member is paying the maintenance charges less than Rs.7,500 per month, whether He/she should pay GST to Society. I mean, the Society shall not levey 18% GST on the maintenance charges on or less than Rs.7500/- . Am I right.?

  4. Nilesh Lakhotiya says:

    After reading the article, it seems the cooperative housing society should apply for GST if following both criteria are fulfilled by it
    1. Contribution per month per member is above 7500/-
    2. Aggregate Receipts above 20 Lakh

    My understanding so far was if either of the above criteria is fulfilled, the GST is compulsory.

    Can you plz clarify

  5. vswami says:


    Regrettably, despite repetitively shared in-puts, for anyone’s guidance, in the write-up the old but thus far UN-resolved issues have been presented with a limited vision. For the most important concept- doctrine of ‘MUTUALITY’ , remaining to percolate through and be made a conscious note of, for taking on and pursuing with an out-of – box insight, it seems a long way to go !

  6. Mohit Pande says:

    There was no Service Tax on member’s contribution for common expenses in Cooperative Housing Societies. Therefore the statement ” In so far as tax implications on housing societies are concerned, the position prevailing under Service Tax is sought to be continued under GST” is not correct.

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June 2021